Owner of Williamsburg business pleads guilty to tax evasion

Michael Scott to be sentenced next year

Published 9:56 PM EDT Aug 21, 2013

CINCINNATI -

The owner of a Williamsburg business pleaded guilty to two counts of income tax evasion.

Michael Scott, 58, of Cincinnati, owns East Fork Construction.

For both the 2007 and 2008 income tax years, Scott willfully included personal gambling expenses in the Cost of Goods Sold section of the Schedule C. By doing so, Scott was able to inflate the business expenses for East Fork Construction, thereby reducing the amount of taxable income and the income tax liability for 2007 and 2008.

Pursuant to an IRS audit of his 2007 and 2008 income tax years, Scott provided the IRS revenue agent conducting the audit with checks that Scott had altered in order to substantiate the personal gambling expenses that he had reported as business expenses. Scott changed the payee information on the checks from the names of casinos to names of false, but legitimate-sounding, building supply companies.

For those income tax years, Scott intentionally included $283,346 of fraudulent expenses. This resulted in a tax loss to the IRS in the amount of $65,402.28

Scott was released on bond. He is scheduled to be sentenced on Jan. 8, 2014.

"Tax evasion is not a victimless crime," said Kathy A. Enstrom, special agent in charge, IRS Criminal Investigation, Cincinnati Field Office. "We all pay when others swindle the government. Tax evasion and tax fraud of this magnitude and with this degree of trickery, dishonesty, and deceit deserves to be punished."

Copyright 2013 byWLWT.comAll rights reserved. This material may not be published, broadcast, rewritten or redistributed.